Obamacare Health Plan Sign-Ups Reach 3 Million, U.S. Says

(Bloomberg) -- About 800,000 people signed up for private health plans through Obamacare in January, pushing total enrollment to 3 million as negative perceptions about the program give way to more practical needs.

Kathleen Sebelius, secretary of the Department of Health and Human Services, touted the January figures in a speech today in Jacksonville, Florida, which add to the 2.2 million who enrolled from Oct. 1 through December. Her agency later said in a blog post that as our outreach efforts kick into even higher gear, we anticipate these numbers will continue to grow.

The acceleration may indicate increased familiarity and interest in the Patient Protection and Affordable Care Act among people who previously had heard only of its problems, said Ron Pollack, executive director of the advocacy group Families USA. Public opinion about Obamacare plunged after the Oct. 1 debut of the insurance exchanges greeted consumers with website breakdowns, higher prices and potentially broken promises.

People were bombarded about the politics and learned precious little about how it would affect their lives, Pollack, whose Washington-based organization has been promoting the health law, said in a telephone interview. Youre seeing a significant acceleration that is just going to be larger and larger as we move toward the end of March.

Insurers Benefit

Higher enrollment should benefit WellPoint Inc., Humana Inc. and other managed-care insurers that rely on a large and diverse patient-mix to balance out the costs of coverage. If the pace of sign-ups continues, enrollment should be close to 5 million by the end of March, said Ana Gupte, an analyst at Leerink Partners in New York. This is positive for HMO stocks that have made a bet in favor of the exchanges, she said in an e-mail.

The Affordable Care Act, which mainly took full effect Jan. 1, marks the largest U.S. expansion of health insurance in more than 40 years. The law set up government-run insurance exchanges where Americans can buy private health plans with the help of federal tax credits. It also expanded eligibility in some state- run Medicaid programs for the poor.

Meeting Targets

The Obama administration had a goal of signing up about 7 million people in private plans by the end of March, based on estimates from the Congressional Budget Office. The laws first enrollment period ends March 31.

We continue to see strong interest nationwide from consumers who want access to quality, affordable coverage, Marilyn Tavenner, the administrator of the U.S. Centers for Medicare and Medicaid Services, said in a blog post.

A Gallup poll released yesterday showed that the percentage of adults without health insurance in the U.S. fell to 16.1 percent this month, the lowest level since the end of 2012.

The 3 million sign-ups reflect people who selected a plan using federal and state enrollment systems. People must pay their first months premium to complete their enrollment, and its unclear what fraction of enrollees havent yet paid.

Word-of-Mouth

Pollack said the enrollment acceleration is driven mainly by word-of-mouth, as people hear stories of friends or neighbors who have found exchange plans they feel are affordable. People earning less than four times the poverty level, or about $94,000 for a family of four, are eligible for tax credits that reduce the monthly premium for exchange plans. About 79 percent of people who had enrolled through December benefited from subsidies, according to a report from Sebeliuss department.

Sebeliuss speech in Jacksonville was part of a travel schedule that frequently takes her to large states with many uninsured people whose Republican governors refused to build their own insurance exchanges. She has made multiple appearances in both Florida and Texas over the past six months, two of the 36 states covered by the federal insurance exchange.